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Feds Say Toyota Concealed Defect; Seek Record Fine

Posted: Apr 06, 2010 10:53 a.m.

The federal government has announced its intention to fine Toyota $16.4 million for allegedly hiding a defect in many of its cars that, government investigators believe, may have led to dozens of deaths.  The defect can reportedly cause the car’s accelerator pedal to become stuck, making the car accelerate without the driver pressing the pedal.

“If it stands, the sanction would represent the largest financial penalty imposed by the U.S. government on an automaker,” according to the Washington Post, though the amount “could rise if the government's ongoing investigation into runaway Toyotas turns up violations related to other defects.”

“We now have proof that Toyota failed to live up to its legal obligations,” Transportation Secretary Ray LaHood said in a statement announcing the fine. “Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families. For those reasons, we are seeking the maximum penalty possible under current laws.”

“Specifically,” Motor Trend explains, “The NHTSA has a problem over Toyota failing to tell the agency about the ‘sticky pedal’ problem for at least four months.”

The Houston Chronicle notes, “The government has linked 52 deaths to crashes allegedly caused by accelerator problems in Toyotas. The recalls have led to congressional hearings, a criminal investigation by federal prosecutors, dozens of lawsuits and an intense review by the Transportation Department.”  A separate investigation by the Los Angeles Times has indicated that more than 100 deaths may ultimately be blamed on the defect.

Toyota, the Chicago Tribune notes, “Has two weeks to accept or contest the penalty.”  In a statement, the automaker did not give its intentions, saying only, “we understand that NHTSA has taken a position on this recall. We have already taken a number of important steps to improve our communications with regulators and customers on safety-related matters as part of our strengthened overall commitment to quality assurance."

Despite the controversy, the automaker has done well in recent weeks.  USA Today notes that Toyota “sales were up more than 40% last month after the automaker laid out modest incentives.”

Check out the latest Toyota recall news and information, including how the company's recent troubles affect our rankings. If you're in the market for a new car, check out the U.S. News rankings of this year's best cars as well as this month's best car deals.